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Shaping the Future
Written by Steve Smith, WaterClaim, June 2006 In 2004, the
Since then, Nebraska has used about 104,000 acre feet more than it is allowed. This overage must be eliminated by the end of 2007 or Nebraska is subject to legal action by Kansas, which already has a judgment against Nebraska. To deal with this problem, Nebraska has participated in land retirement programs that have shutdown about 45,000 irrigated acres via CREP and EQIP. It has also purchased all available surface water from the Nebraska irrigation districts for the 2006 irrigation season. The combined efforts will still leave Nebraska over its allocation at the 2007 deadline. The DNR has not released the benefit in acre feet that it expects to receive from the 2006 surface water purchase. Even if the surface water purchase is worth 35,000 acre feet and CREP/EQIP benefit Nebraska 10,000 by the end of 2007, Nebraska will still be over its allocation by a significant amount. Note that shutting off all 12,000 irrigation wells in the Basin for two years would not result in enough savings to erase the overage. At the end of 2007, Kansas has the option of complaining to the Republican River Compact Administration. This is a three member board made up of the three water department heads (Kansas, Colorado, and Nebraska). Kansas can make this complaint in the summer of 2008, once the official 2003 through 2007 numbers are released. Assuming Kansas is not satisfied with the results of this complaint, it can ask for non-binding arbitration. (Note that Nebraska officials are putting a very large amount of hope in the idea that Kansas will have mercy.) That could be resolved during late 2008 or early 2009. If one of the parties is not satisfied with the results of the arbitration, then they can go to the US Supreme Court.. If it is Kansas that goes to the Supreme Court, then a Special Master could be appointed in 2009 or 2010 and this individual would then control the economic fate of the Republican River Basin. If Kansas is happy with the results of the arbitration, then it is likely that Nebraska and Colorado will not be. However, their chances of a successful appeal to the Supreme Court are much less likely . Therefore, the decisions of the arbitrators are important. The non-binding arbitration could result in an order to Nebraska and Colorado to shut down all irrigation wells until the two states are in compliance. This would take about three years of no irrigation. An order to shut down all wells within 1 mile or 2.5 miles would also result in compliance in about three years. In other words, shutting off wells more than 2.5 miles from the stream have little effect for 15 years; and if fast compliance is required, it doesn't accomplish much in the short term to shut them off. Assuming compliance is achieved through the ordered shutdown of irrigation, then the questions become: how many acres have to be shut off and who, if anyone, pays for their shutdown? The Nebraska Department of Natural Resources refuses to release basic information on this subject. It will not report how many acres are directly connected to the stream, how many are within 1 mile, how many are between 1 and 2 miles and how many are between 2 and 2.5 miles. It will not release the benefit to the stream of shutting off combinations of these wells. However, WaterClaim has been able to obtain most of the information via open records requests or going to the people who provide the DNR with the information. Table 2 - Acres by Type and Location There are no official numbers. These are numbers we have found from various sources. The fact that they are not quite logical doesn't mean we got the numbers wrong; it simply means the DNR does not have an official set of numbers. The official numbers either do not exist or are classified. The benefit in acre feet are approximations based off of DNR graphs. Because key data is hidden, it means that the NRDs are acting in the dark. It also means that only the State has the information necessary to make decisions. However, the numbers are close enough to being correct that we can make some reasonable estimates. The least expensive option to the State is to lease or purchase all irrigated acres that are called stream cell acres. There are 145,201 of these. If Quick Response acres or CREP eligible acres are also retired, then more acres have to be shut down to get the desired result. Shutting off these wells permanently will probably keep Nebraska in compliance for at least 17 years. The Federal Government is paying to retire 70,000 CREP acres. About half of those acres have been enrolled. Rather than increasing the incentive for people to enroll these acres, the State is planning to expand the eligible area -- which results in less benefit per acre. If one works on the assumption that the 70,000 acres eligible for CREP will be enrolled, then at least another 75,000 acres have to be permanently turned off. The cost of buying 75,000 acres would be $1,000 an acre if just the water is purchased but the land is left in possession of the current land owner. That would be a $75 million cost, plus administrative costs of forcing the sale. If the land is leased on an annual basis, then the average market rate is $130 an acre, and this increases at an average of $2 an acre each year. Some land currently rents for more. Sugar Beet and Potato leases are worth about $200 an acre. We use an average of $150 a year over a 17-year time frame. This would cost someone a little over $11 million a year. Forced land retirement will not provide any compensation to the businesses that rely on irrigation. Most of the irrigated stream cell acres are in the Lower Republican NRD and, hence, there would be a much greater impact there on the business community. About 30% of the LRNRD is stream cell, and some communities will lose all of their irrigated acres and, therefore, most of their ag businesses. This forced shut down of stream cell acres will not restore the Republican River to its pre-development flows nor stop the aquifer decline in the Upper Republican NRD. No one will want to pay the $75 million or the $11 million a year or any compensation to the businesses affected. In fact, it has been suggested by a noted Lincoln water law specialist that no compensation is owed to the landowners that are denied access to water. David Aikens argues that since the water is owned by the State, it can decide to use that water for things other than irrigating crops. The landowner only has access to the water as long as the State wants the water to be used that way. If the State chose to shut down acres without compensation, the State would be sued. If the Court decides that the landowner is due compensation, then the bill will be paid by the State. If the Court decides that no or limited compensation is due the landowner, then there will be a large number of communities that fail and individuals who go broke. Even if the landowners win the lawsuits about compensation, it will take a long time for the Courts to make this ruling; and if the wells are shut off during this time, it will result in irreversible individual bankruptcies. Either way, there will be a large bill to pay for compliance. The cost of compliance is much less if water is transferred into the Republican River Basin from the Platte River Basin. However, so far, the sitting policy makers prefer to shut off irrigated acres rather than increase water supply. Many of the decision makers will take office January 2007. This group can choose to:
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